# Properties of Iso-quant curve

Definition: An Iso-quant curve shows the different combinations of factors of production Viz. Labor and Capital employed to yield the given level of production.

## Properties of Iso-quant Curve

1. The iso-quant curve is negatively sloped, which means, in order to have a same level of production, the more use of units of one input factor is to be offset with the lesser units of another input factor. This complies with the principle of Marginal Rate of Technical Substitution (MRTP). For example, with more units of capital, the lesser units of labor are to be employed to have a same level of output.In the figure, it is clear that the reduction in capital is to be set off with the increase in the labor, and thus, the IQ is negatively sloped.
2. The iso-quant curve is convex to the origin because of the MRTP effect. This shows that factors of production are substitutable for each other and with the increase in one factor the other has to be reduced to have the same level of production.
3. Iso-quant curves cannot intersect or be tangent to each other. If these intersects, then the results will be incorrect. A common factor combination on both the curves will show the same level of output, which is not feasible.
As per the figure, at point A, different combinations on IQ1 and IQ2 produces the same level of output which is not feasible. Since both the curves show different levels of output i.e. 100 and 200 units respectively.
4. Upper iso-quant curves yield higher outputs. This is possible because, at a higher curve, more factors of production are employed either the capital or the labor, which results in more production.The arrow in the figure shows an increase in the output with a right and upward shift of an iso-quant curve.
5. No iso-quant curve touches either of the axis, X or Y. If it does so, then the rate of technical substitution would be void since it will show that a single factor is producing the given level of output without any units of other factor being employed.As per the figure, if an iso-quant curveĀ  IQ2 touches the X axis, this means no units of labor are employed, and only capital is required to produce the given level of output, which is not correct.
6. Iso-quant curves need not be parallel to each other because the rate of technical substitution between the factors may vary in all the iso-quant curves.
7. Each iso-quant curve is oval shaped, which enables a firm to identify the most efficient factor of production.In the figure above, the point N and M shows the same level of output with different combinations of labor and capital. At point N, more capital is employed than labor. Therefore, it is more expensive as compared to the combination shown at point M, where more labor is used as compared to the capital. Similarly, the combination at point K can be ruled out because of the positive slope. Which means that, with an increase in the labor, more capital is to be employed to have a constant production.

Hence, it is clear from the properties of an iso-quant curve that a firm can have a same level of production with different combinations of labor and capital that must be utilized in such a way that the overall profitability of the firm increases.

## Related pages

resonant meaningwhat is oligopoly markettruncation definehedge funds definitionspearman rank correlation examplessingal meaningholistic approach meaning in urduimplied meaning in hindiinfluences on consumer buying behaviourtypes of speculatorsmeaning of higher purchasesorting techniques with examplesindifference mapdefine inventories in accountinghow to calculate asset turnover ratiocamels bankingproportionate sampling techniqueoptimality definitionwhat is recruitment process in hrmwhat is classical management theorymeaning of snowball samplingmicro financing definitiontheories of consumer buying behaviourthe theory of operant conditioningoligopoly is a market structure in whichsnowball sample examplemax weber and bureaucracy theorydelegation of authority and decentralisationhybrid debt instrumentdefine slrdraw indifference curveleveraged lease meaningblack scholes formula calculatorclassification of elasticity of demandpersonality theoristsdefinition of probability samplingpublicity definition marketingdefine rationing in economicskarl pearson correlation coefficient formulaa firm in an oligopolistic marketdefinition of environmental audittheory of mcclellanddepth and breadth of product linerbi meaningdefine expansionistmoa defineequipment finance agreement definitionstratify definitionwhat is the meaning of marginal utilityspeculative motive for holding moneywhat is monopolistic competition market structureporter five forces frameworkivan pavlov theory summarywhat does provident meanordinal scale exampleconvertible debenture definitionlaissez faire translationblack scholes put option calculatormarketing dashboard definitionforecasting and demand measurement in marketingmeaning of bepgeneral principles of management henri fayolholistically definitionmeaning of ganttelastic demand definition economicsdefinition truncationinventory outsourcingdefinition judgementaldefine monetary policy in economicsneft minimum and maximum limitanti takeoverdefinition of primalego states transactional analysisdefine dasanisnowball sample examplemeaning of monopoly in economics